Regulation
IFRS 9 versus BAM NPL classification
Two grids, two questions: do not merge them into a price.
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- Serenor Capital
- Published
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- 2 min read
IFRS 9 organises credit risk into stages for accounting impairment. Bank Al-Maghrib organises non-performing claims under its own prudential grid. A file can be stage 3 for accounting purposes and still require a full economic recovery analysis. Acquisition price cannot be read off a stage alone.
Two purposes
BAM classification primarily serves supervision and minimum prudential provisioning. IFRS 9 serves expected credit loss measurement in the financial statements. The two may converge empirically on some files; they are not designed as synonyms.
For a buyer, the question is not 'what is the stage?' but 'what cash flows, timing, costs and settlement authorities remain after transfer?' Stage is a signal. It is not the model.
What the tape should separate
A useful tape distinguishes, where available, prudential class, accounting stage, date of non-performance and allowance amount. If one column mixes those notions, the analyst reconstructs blind.
The 68% coverage ratio published by Bank Al-Maghrib at end-2025 for the NPL stock is a prudential aggregate. It is neither a portfolio-level IFRS 9 coverage rate nor an implied sale price.
Crossing to economic value
Serenor's valuation method starts from recovery cash flows, not from the stock of allowances. A high allowance can coexist with material remaining recovery, and the reverse. That is the point of separating accounting provision from economic value elsewhere on this site.
Where a seller communicates only IFRS 9 stages, due diligence must rebuild the operating grid: security, procedure, contact, settlement authority. Otherwise stage becomes a misleading substitute for analysis.
What not to conclude
This note does not rank IFRS 9 above BAM or the reverse. It only refuses to merge them into a price. Draft Law 02-26, which is not promulgated, does not change that reading discipline either.
No stage-to-price conversion rate is offered. Any bid remains portfolio work.
In this series
This note is a method of reading a file or a published series. It is not legal, tax or investment advice, and it is not an opinion on a particular exposure. Serenor Capital does not buy claims for its own account, manage a fund, or carry on collection.
Sources and references
- Bank Al-Maghrib, Annual Report on Banking Supervision, financial year 2025 — PDF
- Bank Al-Maghrib, Circular No. 19/G/2002 of 23 December 2002 on the classification of claims and their provisioning, as amended — PDF
- Circular No. 1/W/2025, adopted on 5 December 2025, effective 1 January 2027. It does not restate the 2012–2025 figures discussed here.
- Dahir forming the Code of Obligations and Contracts (DOC); Commercial Code, Book V, as amended by Law 73-17, where relevant.
- Serenor public series — Morocco NPL Monitor and methodology
Frequently asked questions
- Does IFRS 9 stage 3 equal a BAM compromised claim?
- No. Definitions, thresholds and purposes differ. Automatic equivalence is an abusive simplification.
- Does the IFRS 9 allowance equal sale price?
- No. The allowance is an accounting measure. Sale price is the discounted economic value of net recovery cash flows.
Evaluating an NPL Portfolio
Serenor Capital supports financial institutions and investors in the analysis and valuation of non-performing loan portfolios in Morocco.
Serenor Capital publishes research on non-performing loans, distressed-credit valuation and the development of Morocco’s secondary credit market.
This note is general commentary on method and market structure. It is not investment advice, legal advice, or a recommendation in relation to any portfolio, transaction or financial asset.